Ethiopian Airlines rejects ‘pilot error’ claim in US

The 737 MAX 8 is currently grounded worldwide after the March crash of Ethiopian Airlines Flight 302. (File/AFP)
Updated 17 June 2019
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Ethiopian Airlines rejects ‘pilot error’ claim in US

  • The Ethiopian Airlines crash killed all 157 people onboard and drew scrutiny to the new Boeing model’s anti-stall system
  • Boeing is working to submit a modified version of the aircraft’s software and hopes to get the approval of aviation authorities

LONDON: A US politician who blamed pilot error for contributing to the deadly crash of a Boeing 737 Max flown by Ethiopian Airlines was “seriously misinformed,” the carrier’s boss has said.
Republican Sam Graves told a House of Representatives hearing last month that “facts” in investigations after crashes in both Ethiopia and Indonesia “reveal pilot error as a factor in these tragically fatal accidents.”
He also said “pilots trained in the United States would have successfully handled the situation” in both incidents.
But in a BBC interview aired Monday, Ethiopian Airlines chief executive Tewolde GebreMariam said criticisms of his crew’s actions were “seriously misinformed,” and that Graves did not “have the facts in his hands.”
“People who’ve made those comments should ask themselves, ‘Why on earth have they grounded 380 airplanes over the world?’ The facts speak for themselves,” he said.
The 737 MAX 8 is currently grounded worldwide after the March crash of Ethiopian Airlines Flight 302, which killed all 157 people onboard and drew scrutiny to the new Boeing model’s anti-stall system.
Pilots were already worried about the safety of the model following the October 2018 crash in Indonesia of a Lion Air 737 MAX 8 that killed 189 people.
Boeing is working to submit a modified version of the aircraft’s software and hopes to get the approval of the US Federal Aviation Administration (FAA) and its counterparts throughout the world.
But aviation regulators meeting last month were unable to determine when the popular jet might again be allowed to fly, causing costly headaches for airlines worldwide.
Revelations of close ties between Boeing and the FAA in testing the MAX led to a crisis of confidence among the public and airline pilots, as well as some of the other agencies that regulate civil aviation.
“We have work to do to win and regain the trust of the public,” Boeing CEO Dennis Muilenburg conceded at the Paris Air Show on Sunday.


China central bank moves to support financial institutions

Chinese 100 yuan banknotes are seen on a counter of a branch of a commercial bank in Beijing, China, March 30, 2016. (REUTERS)
Updated 24 July 2019
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China central bank moves to support financial institutions

  • Many market watchers believe the PBOC will adjust its money market rates in early August if the US Federal Reserve cuts its key rate, as widely expected, on July 31

BEIJING: China’s central bank offered medium-term loans to financial institutions on Tuesday in an attempt to get more affordable funds to struggling smaller firms, as it steps up efforts to support a slowing economy.
With growth in China sliding to a near 30-year low, global financial markets are closely watching to see if the People’s Bank
of China (PBOC) will trim interest rates soon in line with expected easing by other central banks.
While the PBOC left rates on the medium-term loans unchanged on Tuesday, and the injection had been expected, it funneled more lower-cost funds into a credit program aimed specifically at reducing strains on small and medium-sized businesses.
The PBOC lent 497.7 billion yuan ($72.31 billion), including 200 billion yuan through one-year medium-term lending facility (MLF) loans and another 297.7 billion yuan through targeted medium-term lending facility (TMLF) loans, it said in a statement.
The size of the TMLF funding was 11 percent larger than the last such injection in April.
Interest rates for both liquidity facilities were unchanged from previous levels. The one-year MLF and TMLF remained at 3.30 percent and 3.15 percent, respectively.
The total amount roughly offset 502 billion yuan of MLF loans that were set to expire on Tuesday,
ensuring a steady supply of cash.
“Replacing some MLF with TMLF effectively cut funding costs. We should focus on the lower rate, instead of the net drainage on the day,” said Frances Cheung, head of Asia macro strategy at Westpac in Singapore.

BACKGROUND

China is keeping all its policy tools within reach as the trade war with the US gets longer and costlier, but sees more aggressive action like interest rate cuts as a last resort given concerns about rising debt.

The central bank said banking system liquidity will be “reasonably ample” after the lending operations.
About 160 billion yuan in reverse repos were also set to expire on Tuesday, according to Reuters calculations based on official data. The PBOC did not say in its statement whether it had drained funds from money markets on Tuesday.

BACKGROUND

China is keeping all its policy tools within reach as the trade war with the US gets longer and costlier, but sees more aggressive action like interest rate cuts as a last resort given concerns about rising debt.

Some traders said Tuesday’s moves were in line with the PBOC’s support measures since last year, which have been aimed at getting more affordable financing to small and private companies.
While Chinese regulators have urged banks to keep lending to distressed firms, such companies are often considered higher credit risks than big, state-owned enterprises.
Traders and analysts still expect the PBOC to cut rates on some of its liquidity tools in coming months.
The PBOC has already slashed banks’ reserve requirement ratios (RRR) six times since early 2018 to free up more money to lend, while guiding short-term market rates lower through liquidity injections in various forms.
Many market watchers believe the PBOC will adjust its money market rates in early August if the US Federal Reserve cuts its key rate, as widely expected, on July 31.
Cheung from Westpac said it was still possible the PBOC could lower the MLF rate after the Fed’s policy decision.
She also has pencilled in a 50 basis-point RRR cut this quarter, and another in the fourth quarter.